Management Board will propose the annual general meeting of shareholders to approve the emission price of 12.0 kroons (0.77 euros) per share. Updated text follows: BALTIKA'S FINANCIAL RESULTS, 1 QUARTER 2010 Despite a decline in sales, Baltika Group succeeded in reducing the loss for the first quarter of 2010 by a half compared with the first quarter of 2009. The Group's performance in the first quarter of 2010 was still influenced by the economic crisis prevailing in its principal markets. On the other hand, the Group's first quarter market results provide an indication of different markets' prospects for exiting the crisis. In the Baltic region, the year-over-year shortfall was the smallest in Estonia (-7%) and the greatest in Lithuania (-29%). The home market that was the first to be hit by the crisis has also the potential to be the first to exit the crisis. Lithuania followed Estonia last year with around a six-month interval and the same may be true about recovery. Latvian sales have also tumbled (-28%) but thanks to the biggest cutback in operating expenses at the level of stores the net result was positive. The Eastern European markets have started recovering at a surprising speed (which may partly be attributed to the strengthening of the local currencies). The Russian market ended the first quarter with sales comparable to a year ago (-5%) and Ukraine reached practically break-even point at the level of stores. On the whole, at the level of stores the retail system of Baltika Group more or less broke even in the first quarter. Although the crisis is receding, the company's performance should still be evaluated based on the dynamics of the three main factors that reflect adaptation to the crisis. These are developments in sales, margins and operating expenses. Baltika's sales for the first quarter were still smaller than a year ago but the shortfall has been decreasing on a quarterly basis (since the third quarter of last year - Q3 2009: -33%; Q4 2009: -28%; Q1 2010: -20%) and on a monthly basis (since November 2009 - November: -32%; December: -26%; January: -22%; February: -20%; and March: -16%). The restructuring of the retail system continues. Since the beginning of this year, the Group has closed five stores and the retail area operated by the Group has decreased by approximately 2% compared with the first quarter of 2009. Baltika Group's gross margin for the first quarter was 46%, reflecting a slight improvement on the 43% posted a year ago. The gross margin for the retail system was 50% (Q1 2009: 41%). Higher profitability results from a better inventory structure, more favourable purchasing margins, an upward price correction in the Russian and Ukrainian markets and smaller discounts in the Baltic countries and Central Europe. Distribution and administrative expenses for the first quarter decreased by 16%, i.e. 22.9 million kroons (1.5 million euros), year-over-year. Expenses for the first quarter of 2010 totalled 119.8 million kroons (7.7 million euros) against 142.7 million kroons (9.1 million euros) incurred in the first quarter of 2009. In the final phase of the economic crisis, Baltika's ongoing adaptation process is aimed at achieving two main goals: - exploiting the crisis as an opportunity for streamlining the Group's business model; and - strengthening the Group's financial position that has been seriously weakened by the crisis. In order to fully achieve the first goal, Baltika has involved in the strategic planning process the international strategy consultancy Roland Berger. In partnership with the consultants, the Group will create by the summer a new growth strategy for the next 3 to 5 years that will provide tools for maximising the potential of Baltika's retail markets and brands and enhancing the efficiency of its business model. The package for strengthening the Group's financial position consists of four components: - disposing of assets not directly related to the core business (during the first quarter the Group disposed of an industrial property at Ahtme, at the end of March the Group sold its coat manufacturing operation in Rakvere and in the second quarter the Group will divest a manufacturing property in Rakvere); - negotiating better settlement terms and price concessions from the suppliers; - restructuring the existing loan portfolio through negotiations with banks; - increasing share capital through a share issue. The management board will propose that the annual general meeting increase the company's share capital by up to ca 9 million shares by a private placement, the price is 12.0 kroons (0.77 euros) per share. Emission is supported by main shareholders. Management believes that the implementation of the above package by July this year will ensure the sustainability of Baltika's financial position until the end of the economic crisis. REVENUE Baltika Group ended the first quarter of 2010 with revenue of 172.9 million kroons (11.1 million euros), a 22% decrease year-over-year. Revenue by business segment -------------------------------------------------------------------------------- | EEK million | Q1 2010 | Q1 2009 | +/- | -------------------------------------------------------------------------------- | Retail | 155.3 | 193.5 | -20% | -------------------------------------------------------------------------------- | Wholesale | 16.1 | 27.3 | -41% | -------------------------------------------------------------------------------- | Other | 1.5 | 0.2 | 650% | -------------------------------------------------------------------------------- | Total | 172.9 | 221.0 | -22% | -------------------------------------------------------------------------------- 1 EUR = 15,6466 EEK RETAIL Owing to the general economic downturn and shrinkage in consumption, the Group's first quarter retail revenue decreased by 20% year-over-year to 155.3 million kroons (9.9 million euros). In the Baltic region, retail revenue decreased by 21%, in Eastern Europe by 13% and in Central Europe by 50%. Retail sales by market -------------------------------------------------------------------------------- | EEK million | Q1 2010 | Q1 2009 | +/- | Percentage, Q1 | | | | | | 2010 | -------------------------------------------------------------------------------- | Estonia | 38.5 | 41.5 | -7% | 25% | -------------------------------------------------------------------------------- | Russia | 34.8 | 36.7 | -5% | 22% | -------------------------------------------------------------------------------- | Lithuania | 33.2 | 46.6 | -29% | 21% | -------------------------------------------------------------------------------- | Ukraine | 24.8 | 32.2 | -23% | 16% | -------------------------------------------------------------------------------- | Latvia | 18.6 | 25.7 | -28% | 12% | -------------------------------------------------------------------------------- | Poland | 5.4 | 7.1 | -24% | 4% | -------------------------------------------------------------------------------- | Czech Republic | 0.0 | 3.7 | -100% | 0% | -------------------------------------------------------------------------------- | Total | 155.3 | 193.5 | -20% | 100% | -------------------------------------------------------------------------------- 1 EUR = 15,6466 EEK BRANDS In terms of brands, the main retail revenue contributor was Monton whose first quarter sales totalled 81.8 million kroons (5.2 million euros), a 22% decrease year-over-year. Mosaic generated revenue of 52.6 million kroons (3.4 million euros), 22% down from a year ago. Retail sales of Baltman totalled 10.8 million kroons (0.7 million euros), a 17% decrease year-over-year, and retail sales of Ivo Nikkolo amounted to 9.7 million kroons (0.6 million euros), 11% up on a year ago. Monton accounted for 53% of the Group's retail revenue while Mosaic contributed 34%, Baltman 7% and Ivo Nikkolo 6%. STORES AND SALES AREA At the end of the first quarter of 2010, Baltika had 131 stores in six countries and a total sales area of 26,178 square metres. In the first quarter, the Group opened three stores - one in Latvia and two in Estonia, and closed five stores - three in Ukraine and two in Russia. Compared with the first quarter of 2009, the number of stores declined by two and the average sales area shrank by 2%. Stores by market -------------------------------------------------------------------------------- | | 31.03.2010 | 31.03.2009 | -------------------------------------------------------------------------------- | Lithuania | 36 | 33 | -------------------------------------------------------------------------------- | Estonia | 32 | 31 | -------------------------------------------------------------------------------- | Russia | 23 | 23 | -------------------------------------------------------------------------------- | Ukraine | 20 | 22 | -------------------------------------------------------------------------------- | Latvia | 15 | 16 | -------------------------------------------------------------------------------- | Poland | 5 | 6 | -------------------------------------------------------------------------------- | Czech Republic | 0 | 2 | -------------------------------------------------------------------------------- | Total stores | 131 | 133 | -------------------------------------------------------------------------------- | Total sales area, sqm | 26,178 | 27,042 | -------------------------------------------------------------------------------- WHOLESALE Wholesale of Baltika's collections accounted for 9% or 16.1 million kroons (1.0 million euros) of the Group's consolidated revenues for the first quarter of 2010, a 41% decrease compared with the first quarter of 2009. The decline in wholesale revenue is largely attributable to developments in the Russian market where in the second quarter of 2009 a wholesale partner's seven stores were taken over and integrated into Baltika's retail system. The impact of the transaction on the Group's first quarter revenue was +12 million kroons (0.8 million euros). EARNINGS AND MARGINS The Group's performance in the first quarter of 2010 continued to be influenced by the economic downturn that has weakened the consumers' purchasing power. Compared with the first quarter of 2009, the Group's revenue decreased by 48.2 million kroons (3.1 million euros), i.e. by 22%. Compared with the last quarter of 2009, Baltika's distribution and administrative expenses decreased by a total of 16.9 million kroons (1.1 million euros). The inventory level remained at the level achieved in the previous quarter: the ratio of total inventories to a square meter of the retail system rose by 0.4% to 7,027 kroons (449 euros) per square metre. In the first quarter of 2010, the Group's performance was positively influenced by favourable movements in the exchange rates. According to the exchange rates of the Bank of Estonia, compared with 2009 the average exchange rates for the first quarter strengthened as follows: the Polish zloty 12% and the Russian rouble 7%. At the same time, the US dollar and the Ukrainian hryvnia weakened by 6% and 5% respectively. The Group's first quarter gross margin was 46% (Q1 2009: 43%). Gross profit amounted to 80.2 million kroons (5.1 million euros), a decrease of 14.7 million kroons (0.9 million euros) compared with a year ago. The gross margin for the retail system improved significantly compared with the first quarter of 2009, rising to 50% (Q1 2009: 41%). This was achieved by negotiating more favourable purchasing margins, cutting operating expenses and adjusting sales prices in markets where the exchange rates had declined. Compared with the first quarter of the previous year, production expenses decreased by around 30%, i.e. 8.1 million kroons (0.5 million euros). In the future, production volumes will decrease in connection with the sale of the Rakvere workshop of AS Virulane. Through a cost-cutting programme implemented in 2009, the Group's distribution costs for the first quarter of 2010 decreased by 22.7 million kroons (1.4 million euros) year-over-year to 108.7 million kroons (6.9 million euros). In the retail system, lease expenses per square metre dropped by 18% on average and personnel expenses declined by 8%. At the same time, the size of the retail system decreased by 2%. On the whole, at the level of stores the retail system incurred a moderate loss (0.3 million kroons/0.02 million euros) but the result was 19.6 million kroons (1.2 million euros) better than the one for the first quarter of 2009. Administrative and general expenses totalled 11.1 million kroons (0.7 million euros), a decrease of 0.2 million kroons (0.01 million euros) compared with the first quarter of 2009. The Group's operating loss for the first quarter of 2010 was 31.4 million kroons (2.0 million euros) against 55.1 million kroons (3.5 million euros) incurred in the first quarter of 2009. Net financial income amounted to 0.3 million kroons (0.02 million euros), a 96% improvement on the net financial expense incurred in the first quarter of 2009. Financial expenses have decreased because the decrease in the exchange rates of several currencies has been replaced by an increase. Net foreign exchange gain for the first quarter of 2010 amounted to 3.3 million kroons (0.2 million euros) whereas in the first quarter of 2009 the Group incurred a net exchange loss of 4.2 million kroons (0.3 million euros). A significant portion of financial expenses is made up of interest expense (3.6 million kroons/0.2 million euros) that grew by 16% year-over year. Interest expense has been influenced by a decrease in EURIBOR and growth in borrowings. Baltika ended the first quarter of 2010 with a net loss of 32.0 million kroons (2.6 million euros). For comparison, the Group's net loss for the first quarter of 2009 was 62.6 million kroons (4.0 million euros). FINANCIAL POSITION As at 31 March 2010, Baltika's consolidated assets totalled 684.8 million kroons (43.8 million euros), a 2% decrease compared with the previous year-end. Compared with 31 December 2009, trade and other receivables increased by 12.0 million kroons (0.8 million euros) to 66.9 million kroons (4.3 million euros). The growth in receivables can be explained by an increase in prepaid taxes and the sale of the MasCara and Herold brands of AS Virulane as well as some non-current assets. At the end of the first quarter, inventories totalled 184.0 million kroons (11.8 million euros), 2% down from the previous year-end. Compared with 31 December 2009, the Group's current assets grew by 5.3 million kroons (0.3 million euros) to 254.5 million kroons (16.3 million euros) at 31 March. Trade and other payables increased within the same time by 11.2 million kroons (0.7 million euros) to 170.6 million kroons (10.9 million euros). At the end of the first quarter, the Group's borrowings totalled 358.7 million kroons (22.9 million euros), including bank loans of 342.2 million kroons (21.9 million euros) and finance lease liabilities of 8.1 million kroons (0.5 million euros). Compared with the previous year-end, the debt burden has increased by 2.8 million kroons (0.8 million euros). The growth in the debt burden results from a new short-term loan. At 31 March 2010, the Group's net debt (interest-bearing liabilities less cash and bank balances) stood at 346.7 million kroons (22.2 million euros). The net debt to equity ratio was 223.2% (31 December 2009: 183.1%).The net debt to equity ratio will improve in the second quarter when the Group will implement a package for strengthening its financial position, which will involve arrangement of an additional share issue and sale of assets not directly required for the core business. At the end of the first quarter, the Group's equity amounted to 155.3 million kroons (9.9 million euros). INVESTMENT In the first quarter of 2010, the Group's capital investments totalled 0.9 million kroons (0.06 million euros) of which 0.7 million kroons (0.04 million euros) was invested in the retail system. In the first quarter of 2009, the Group invested 37.0 million kroons (2.4 million euros) of which 4.2 million kroons (0.3 million euros) was invested in the retail system. PEOPLE At 31 March 2010, Baltika Group employed 1,647 (31 March 2009: 1,902) people, 894 (2009: 939) of them in the retail system, 564 (2009: 758) in manufacturing and 189 (2009: 205) at the head office. The period's average number of staff was 1,672 (Q1 2009: 1,938). The Group's employee remuneration expenses for the first quarter of 2010 totalled 41.1 million kroons/2.7 million euros (Q1 2009: 53.4 million kroons/3.4 million euros). The remuneration of the members of the supervisory council and management board amounted to 1.3 million kroons/80 thsousand euros (Q1 2009: 1.05 million kroons/67 thousand euros). KEY FIGURES OF THE GROUP (Q1 2010) -------------------------------------------------------------------------------- | | 31.03.2010 | 31.03.2009 | +/- | -------------------------------------------------------------------------------- | Revenue (EEK million) | 172.9 | 221.0 | -21.8% | -------------------------------------------------------------------------------- | Retail sales (EEK million) | 155.3 | 193.5 | -19.7% | -------------------------------------------------------------------------------- | Share of retail sales in revenue | 90% | 88% | | -------------------------------------------------------------------------------- | Number of stores | 131 | 133 | -1.5% | -------------------------------------------------------------------------------- | Sales area (sqm) | 26,178 | 27,042 | -3.2% | -------------------------------------------------------------------------------- | Number of employees (end of | 1,647 | 1,902 | -13.4% | | period) | | | | -------------------------------------------------------------------------------- | Gross margin | 46.0% | 42.9% | | -------------------------------------------------------------------------------- | Operating margin | -18.1% | -24.9% | | -------------------------------------------------------------------------------- | EBT margin | -18.3% | -28.2% | | -------------------------------------------------------------------------------- | Net margin | -18.5% | -28.3% | | -------------------------------------------------------------------------------- | Current ratio | 0.8 | 1.1 | -27.3% | -------------------------------------------------------------------------------- | Inventory turnover | 3.99 | 4.48 | -10.9% | -------------------------------------------------------------------------------- | Debt to equity ratio | 225.5% | 140.4% | | -------------------------------------------------------------------------------- | Return on equity | -74.4% | -28.1% | | -------------------------------------------------------------------------------- | Return on assets | -21.3% | -11.7% | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- 1 EUR = 15,6466 EEK Definitions of key ratios Gross margin = (Revenue-Cost of goods sold)/Revenue Operating margin = Operating profit/Revenue EBT margin = Profit before income tax/Revenue Net margin = Net profit (attributable to parent)/Revenue Current ratio = Current assets/Current liabilities Inventory turnover = Revenue/Average inventories* Debt to equity ratio = Interest-bearing liabilities/Equity Return on equity (ROE) = Net profit (attributable to parent)/Average equity* Return on assets (ROA) = Net profit (attributable to parent)/Average total assets* *Based on 12-month average CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (unaudited, in EEK thousand) -------------------------------------------------------------------------------- | | Q1 2010 | Q1 2009 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Revenue | 172,850 | 221,017 | -------------------------------------------------------------------------------- | Cost of goods sold | -92,673 | -126,091 | -------------------------------------------------------------------------------- | Gross profit | 80,177 | 94,926 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Distribution costs | -108,721 | -131,382 | -------------------------------------------------------------------------------- | Administrative and general expenses | -11,053 | -11,334 | -------------------------------------------------------------------------------- | Other operating income | 9,177 | 11 | -------------------------------------------------------------------------------- | Other operating expenses | -932 | -7,319 | -------------------------------------------------------------------------------- | Operating loss | -31,352 | -55,098 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Finance income | 3,291 | 6 | -------------------------------------------------------------------------------- | Finance costs | -3,600 | -7,299 | -------------------------------------------------------------------------------- | Loss before income tax | -31,661 | -62,391 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Income tax | -52 | -151 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Net loss | -31,713 | -62,542 | -------------------------------------------------------------------------------- | Loss attributable to: | | | -------------------------------------------------------------------------------- | Net loss attributable to equity holders of the | -31,955 | -62,563 | | parent company | | | -------------------------------------------------------------------------------- | Net loss attributable to minority shareholders | 242 | 21 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Other comprehensive income (loss) | | | -------------------------------------------------------------------------------- | Currency translation differences | 454 | -7,145 | -------------------------------------------------------------------------------- | Total comprehensive loss | -31,259 | -69,687 | -------------------------------------------------------------------------------- | Comprehensive loss attributable to: | | | -------------------------------------------------------------------------------- | Equity holders of the parent company | -31,501 | -68,497 | -------------------------------------------------------------------------------- | Minority shareholders | 242 | -1,190 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Basic earnings per share, EEK | -1.71 | -3.36 | -------------------------------------------------------------------------------- | Diluted earnings per share, EEK | -1.71 | -3.36 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME | | -------------------------------------------------------------------------------- | (unaudited, in EUR thousand) | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | | Q1 2010 | Q1 2009 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Revenue | 11,047 | 14,126 | -------------------------------------------------------------------------------- | Cost of goods sold | -5,923 | -8,059 | -------------------------------------------------------------------------------- | Gross profit | 5,124 | 6,067 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Distribution costs | -6,949 | -8,397 | -------------------------------------------------------------------------------- | Administrative and general expenses | -706 | -724 | -------------------------------------------------------------------------------- | Other operating income | 587 | 1 | -------------------------------------------------------------------------------- | Other operating expenses | -60 | -468 | -------------------------------------------------------------------------------- | Operating loss | -2,004 | -3,521 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Finance income | 210 | 0 | -------------------------------------------------------------------------------- | Finance costs | -230 | -466 | -------------------------------------------------------------------------------- | Loss before income tax | -2,024 | -3,988 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Income tax | -3 | -10 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Net loss | -2,027 | -3,997 | -------------------------------------------------------------------------------- | Loss attributable to: | | | -------------------------------------------------------------------------------- | Net loss attributable to equity holders of the | -2,042 | -3,999 | | parent company | | | -------------------------------------------------------------------------------- | Net loss attributable to minority shareholders | 15 | 1 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Other comprehensive income (loss) | | | -------------------------------------------------------------------------------- | Currency translation differences | 29 | -457 | -------------------------------------------------------------------------------- | Total comprehensive loss | -1,998 | -4,454 | -------------------------------------------------------------------------------- | Comprehensive loss attributable to: | | | -------------------------------------------------------------------------------- | Equity holders of the parent company | -2,013 | -4,378 | -------------------------------------------------------------------------------- | Minority shareholders | 15 | -76 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Basic earnings per share, EUR | -0.11 | -0.21 | -------------------------------------------------------------------------------- | Diluted earnings per share, EUR | -0.11 | -0.21 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | CONSOLIDATED STATEMENT OF FINANCIAL | | | | POSITION | | | -------------------------------------------------------------------------------- | (unaudited, in EEK thousand) | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | | 31.03.2010 | 31.12.2009 | -------------------------------------------------------------------------------- | ASSETS | | | -------------------------------------------------------------------------------- | Current assets | | | -------------------------------------------------------------------------------- | Cash and bank | 3,588 | 6,024 | -------------------------------------------------------------------------------- | Trade and other receivables | 66,933 | 54,932 | -------------------------------------------------------------------------------- | Inventories | 183,953 | 188,181 | -------------------------------------------------------------------------------- | Total current assets | 254,474 | 249,137 | -------------------------------------------------------------------------------- | Non-current assets | | | -------------------------------------------------------------------------------- | Deferred income tax asset | 16,488 | 16,488 | -------------------------------------------------------------------------------- | Other non-current assets | 7,335 | 7,728 | -------------------------------------------------------------------------------- | Investment property | 103,294 | 103,294 | -------------------------------------------------------------------------------- | Property, plant and equipment | 239,505 | 263,165 | -------------------------------------------------------------------------------- | Intangible assets | 63,731 | 62,133 | -------------------------------------------------------------------------------- | Total non-current assets | 430,353 | 452,808 | -------------------------------------------------------------------------------- | TOTAL ASSETS | 684,827 | 701,945 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | EQUITY AND LIABILITIES | | | -------------------------------------------------------------------------------- | Current liabilities | | | -------------------------------------------------------------------------------- | Borrowings | 148,092 | 122,942 | -------------------------------------------------------------------------------- | Trade and other payables | 170,617 | 159,375 | -------------------------------------------------------------------------------- | Total current liabilities | 318,709 | 282,317 | -------------------------------------------------------------------------------- | Non-current liabilities | | | -------------------------------------------------------------------------------- | Borrowings | 210,603 | 232,942 | -------------------------------------------------------------------------------- | Other liabilities | 202 | 114 | -------------------------------------------------------------------------------- | Deferred income tax liability | 0 | 0 | -------------------------------------------------------------------------------- | Total non-current liabilities | 210,805 | 233,056 | -------------------------------------------------------------------------------- | TOTAL LIABILITIES | 529,514 | 515,373 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | EQUITY | | | -------------------------------------------------------------------------------- | Share capital at par value | 226,449 | 226,449 | -------------------------------------------------------------------------------- | Share premium | 1,049 | 1,049 | -------------------------------------------------------------------------------- | Reserves | 43,567 | 43,567 | -------------------------------------------------------------------------------- | Retained earnings | -77,617 | 81,487 | -------------------------------------------------------------------------------- | Net profit (loss) for the period | -31,955 | -159,104 | -------------------------------------------------------------------------------- | Currency translation differences | -8,956 | -9,410 | -------------------------------------------------------------------------------- | Total equity attributable to equity holders | 152,537 | 184,038 | | of the parent company | | | -------------------------------------------------------------------------------- | Minority interest | 2,776 | 2,534 | -------------------------------------------------------------------------------- | TOTAL EQUITY | 155,313 | 186,572 | -------------------------------------------------------------------------------- | TOTAL LIABILITIES AND EQUITY | 684,827 | 701,945 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | CONSOLIDATED STATEMENT OF FINANCIAL | | | | POSITION | | | -------------------------------------------------------------------------------- | (unaudited, in EUR thousand) | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | | 31.03.2010 | 31.12.2009 | -------------------------------------------------------------------------------- | ASSETS | | | -------------------------------------------------------------------------------- | Current assets | | | -------------------------------------------------------------------------------- | Cash and bank | 229 | 385 | -------------------------------------------------------------------------------- | Trade and other receivables | 4,278 | 3,511 | -------------------------------------------------------------------------------- | Inventories | 11,757 | 12,027 | -------------------------------------------------------------------------------- | Total current assets | 16,264 | 15,923 | -------------------------------------------------------------------------------- | Non-current assets | | | -------------------------------------------------------------------------------- | Deferred income tax asset | 1,054 | 1,054 | -------------------------------------------------------------------------------- | Other non-current assets | 469 | 494 | -------------------------------------------------------------------------------- | Investment property | 6,602 | 6,602 | -------------------------------------------------------------------------------- | Property, plant and equipment | 15,307 | 16,819 | -------------------------------------------------------------------------------- | Intangible assets | 4,073 | 3,971 | -------------------------------------------------------------------------------- | Total non-current assets | 27,505 | 28,940 | -------------------------------------------------------------------------------- | TOTAL ASSETS | 43,768 | 44,862 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | EQUITY AND LIABILITIES | | | -------------------------------------------------------------------------------- | Current liabilities | | | -------------------------------------------------------------------------------- | Borrowings | 9,465 | 7,857 | -------------------------------------------------------------------------------- | Trade and other payables | 10,904 | 10,186 | -------------------------------------------------------------------------------- | Total current liabilities | 20,369 | 18,043 | -------------------------------------------------------------------------------- | Non-current liabilities | | | -------------------------------------------------------------------------------- | Borrowings | 13,460 | 14,888 | -------------------------------------------------------------------------------- | Other liabilities | 13 | 7 | -------------------------------------------------------------------------------- | Deferred income tax liability | 0 | 0 | -------------------------------------------------------------------------------- | Total non-current liabilities | 13,473 | 14,895 | -------------------------------------------------------------------------------- | TOTAL LIABILITIES | 33,842 | 32,938 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | EQUITY | | | -------------------------------------------------------------------------------- | Share capital at par value | 14,473 | 14,473 | -------------------------------------------------------------------------------- | Share premium | 67 | 67 | -------------------------------------------------------------------------------- | Reserves | 2,784 | 2,784 | -------------------------------------------------------------------------------- | Retained earnings | -4,961 | 5,208 | -------------------------------------------------------------------------------- | Net profit (loss) for the period | -2,042 | -10,169 | -------------------------------------------------------------------------------- | Currency translation differences | -572 | -601 | -------------------------------------------------------------------------------- | Total equity attributable to equity holders | 9,749 | 11,762 | | of the parent company | | | -------------------------------------------------------------------------------- | Minority interest | 177 | 162 | -------------------------------------------------------------------------------- | TOTAL EQUITY | 9,926 | 11,924 | -------------------------------------------------------------------------------- | TOTAL LIABILITIES AND EQUITY | 43,768 | 44,862 | -------------------------------------------------------------------------------- Ülle Järv CFO, Member of the Management Board +372 630 2731 ylle.jarv@baltikagroup.com